December 14, 2014 | Uncategorized | No Comments
Although researchers and professionals have been studying human performance and motivation for many decades, company leaders today realize they have to pay more attention to engagement than they did in the past.
Although researchers and professionals have been studying human performance and motivation for many decades, company leaders today have begun to realize that they have to pay more attention to engagement than they did in the past. SIMPLE TRUTH #9: People want to be feel valued and appreciated.
Gone is the industrial age where humans did jobs that robots and technology eventually replaced. Next, we flew through the knowledge age as companies became more customer-focused and leaders realized the information in people’s heads had value to the business in terms of intellectual property. Now, in the talent age, companies are competing for human beings who possess talents of emotional intelligence, agility, collaboration and innovation – in addition to – technical skills and work experience. The competition for talent is global. Jobs are posted regularly for roles in companies that didn’t exist even a year ago because of advances in technology and to keep pace with the world economy.
Today’s employees are acutely aware that their talents have value in the marketplace. They know that companies should pay a fair wage for what they do. And they know that some companies value their skills more than others (i.e. pay better wages for the same work.) While compensation is not the only reason people join companies, or the sole factor in employee engagement, you want to show you value people by paying competitive, market-valued wages or you risk losing the talent you have – or not attracting the right talent in the first place.
Savvy investors understand that tech start-ups are mostly intellectual property, and because of that, they expect to see comprehensive information in business plans related to compensation, career development and employee retention initiatives start-up leaders plan to execute. In the first dot com start-up I worked in, they were in search of another round of financing, and the executive team realized the business plan lacked focus on the people and culture as investors expected.
While the leaders claimed the employees were their most important asset, investors uncovered that while a few employees were paid market value wages, most were paid below market and some were paid significantly below market. In addition to base wages, the company gave stock options, paid 100% of health benefits and had a casual work environment including free food. And while the ‘total package’ appeared very generous to the executive leaders who’d never been treated so well in their careers, employees knew those offerings were a minimum standard in high tech companies at the time.
By the company’s 2-year anniversary, the gap between executive and employee perceptions had increased – causing unrest in the company. Although executives verbalized regularly, “our people are our most important asset,” employees challenged those statements almost daily. The collective employee perspective was, “If we are SO important – show us we are. Put your money where your mouth is.” Key employees openly threatened to quit while others were not discreet about talking about job interviews they went to at the competition.
The concerns about a potential mass exodus of talent prompted the leaders to hire an outside consultant to come in and evaluate the compensation and benefit offerings. They were confident the company paid well compared to its competitors and aimed to prove it to the employees.
Unfortunately, their plan backfired. The compensation study proved the company was paying on the lower side of the wage scale for all their jobs. [Not a good outcome if you tout your company as a leader in technology and an employer-of-choice.] And although they meant well, the executive leaders did not want to increase the cost of the payroll, so they chose not to use the job descriptions that were created or adjust compensation. Instead, they moved forward taking no action and a steady stream of key talent left to work for competitors that paid market value, and higher, for the same work and similar work environment.
Although leaders have learned MANY hard lessons since the early dot com days, this example is not unusual and still applies today. Employees understand that you want to pay as little as you can, for as long as you can, in order to save money. It makes sense to keep operating costs down at all stages of business evolution. However, there is competition out there for talented employees.
Remember, employee engagement is, in part, the discretionary effort people choose to take as it relates to the work you pay them to do. In a survey I did titled, “Are all of your skills & talents being used at work?” some of the 200 employees surveyed admitted:
- “I would use more of my talents and expend more energy if it were recognized by my manager.”
- “I have experience doing several things that my manager doesn’t even know about me that I could do in my current job.”
- and 71% said “I have left a past position or company primarily because I believed my talents were unrecognized or underutilized.
What survey respondents also conveyed was when they are able to use all of their talents at work, “they feel energetic, are highly productive and get a lot accomplished.” A WIN-WIN for everyone. When people feel valued and appreciated, it shows in your bottom line. People Matter in Business.
Cindy Goyette, SPHR – Maximizing Human Capital, Inc. 2014